Lana Oconnell
If you're an international student working in the US, you'll need to complete Form W-4, the Employee's Withholding Allowance Certificate, for your employer. This is an Internal Revenue Service (IRS) tax form that helps determine how much federal tax should be withheld from each of your paychecks and sent to the IRS. The W-4 form asks for basic personal information and allows you to claim dependents or use deductions to lower your tax withholding. You can find the form on the IRS website or through your employer, and you may be able to fill it out online through your employer's payroll system. It's important to fill out all seven lines of the form accurately and double-check your information before submitting it.
| Characteristics | Values |
|---|---|
| Purpose | To provide your employer with information about your tax filing status, other jobs you or your spouse has, credits and deductions you expect to take, and other factors that play into how much tax you might owe. |
| Who needs to fill it out | Anyone who starts working in the US |
| How often | Not mandatory to update every year, but your employer should remind you before December 1 each year to submit a new W-4 form if your withholding allowances have changed or will change for the next year. |
| How to obtain | May be available through your employer, or you can download a copy from the IRS website. |
| How many sections to fill out | Seven lines on the form, all seven must be filled out before sending it off. |
| Where to send | Give the signed form to your employer's human resources or payroll team. You may also be able to fill it out online through your employer's payroll system. |
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What You'll Learn
Understanding W-4 allowances and deductions
The W-4 form, or the Employee's Withholding Allowance Certificate, is a tax form from the Internal Revenue Service (IRS) that must be filled out by anyone who starts working in the US. The form helps determine how much should be withheld from each paycheck through federal taxes and sent to the IRS. It is important to understand the allowances and deductions associated with the W-4 form to ensure that you are paying the correct amount of taxes over the tax year.
In the past, the value of a withholding allowance was tied to the amount of the personal exemption. However, due to changes in the law, it is no longer possible to claim personal or dependency exemptions. Now, employees who want to lower their tax withholding must claim dependents or use a deductions worksheet. The deductions worksheet can be found on page three of the W-4 form.
If you have more than one job or are married filing jointly, and both you and your spouse work, more money should usually be withheld from the combined pay for all the jobs. To account for multiple jobs, the W-4 form provides three different options in Step 2:
- Complete the Multiple Jobs Worksheet on page three of only the highest-paying job's W-4.
- Check the box on both W-4s if you and your spouse have a total of two jobs with similar pay.
- Instruct your employer to withhold an extra amount of tax from your paycheck or send estimated tax payments to the IRS yourself.
You should generally decrease your withholding if you are eligible for income tax credits or deductions other than the basic standard deduction. This includes itemized deductions, the deduction for IRA contributions, or the deduction for student loan interest. The simplest way to increase your withholding is to enter the additional amount you would like withheld from each paycheck in Step 4(c) of the W-4 form.
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Claiming dependents
If you wish to claim dependents on your W-4 form, you can do so in Step 3 of the form. This is where you must list your dependents. However, it's important to note that the W-4 form introduced in 2020 no longer asks for a number of allowances. Instead, you can simply indicate how much you want withheld from each paycheck in Step 4.
If you have more than one job, you should only complete Steps 3 through 4(b) on the W-4 form for your highest-paying job. If you and your spouse have a total of two jobs and earn roughly the same amount, you can check the box on both W-4 forms in Step 2(c).
Other Options for Adjusting Withholding
In addition to claiming dependents, there are other ways to adjust your withholding. You can use the IRS's online Tax Withholding Estimator or the Multiple Jobs Worksheet on page three of the W-4 form. If you want more taxes withheld from your paychecks, you can reduce the number of dependents or add an extra amount to withhold in Line 4(c). On the other hand, if you want fewer taxes withheld, you can increase the number of dependents or reduce the amount withheld in Line 4(c).
It's important to review your W-4 form periodically, especially after life changes such as getting married, having children, or taking on a side job, as these events can impact your tax liability. You can submit a new W-4 form at any time to adjust your withholding and ensure you're paying the correct amount of taxes.
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Multiple jobs worksheet
The W-4 form, or the Employee's Withholding Allowance Certificate, is an Internal Revenue Service (IRS) tax form that must be filled out when starting work in the US. It helps employers understand an employee's tax profile, including their tax filing status, other jobs, credits, deductions, and other factors that affect tax liability.
The W-4 form has a direct impact on an individual's paycheck and tax refund. It is essential to account for all jobs, including multiple jobs or those held by a spouse, additional income, credits, and tax deductions. A 'Multiple Jobs Worksheet' is attached to the W-4 form and should be used in such cases.
The 'Multiple Jobs Worksheet' is found on page three of the W-4 form. It should be completed for the highest-paying job. If you and your spouse have a total of two jobs with roughly similar pay, you can check the box on both W-4 forms. However, this option will split the standard deduction in half for each job, so it may not be suitable if there are more than two jobs.
It is worth noting that you can choose not to disclose multiple jobs or other sources of income to your employer. In such cases, you can instruct your employer to withhold an extra amount of tax from your paycheck or send estimated tax payments to the IRS yourself.
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Additional deductions and credits for international students
International students in the US on F-1, J-1, or M-1 visas are considered nonresident aliens and are not eligible for tax credits like the American Opportunity Tax Credit (AOTC) or the Lifetime Learning Credit (LLC). However, they can still reduce their federal income tax liability by claiming a tax treaty benefit, which may allow them to fully or partially exempt their US-sourced income from federal and state income taxes. The US tax treaty network covers over 65 countries, and most treaties have provisions for students. For example, due to a tax treaty between the US and Indian governments, Indian residents are entitled to additional deductions and credits not available to citizens of other countries.
International students are exempt from Social Security Tax and Medicare Tax on wages earned from services performed within the United States, as long as they are in F-1, J-1, or M-1 status for less than five calendar years. To qualify for this exemption, the services performed must be allowed by USCIS for these nonimmigrant statuses and must be closely connected to the purpose for which the visa was issued.
Additionally, international students can use deductions and exemptions to reduce their tax liability. For example, they can claim a scholarship or fellowship grant that is entirely tax-free, as described in Chapter 1 of Publication 970, Tax Benefits for Education. Any other income that is nontaxable under the Internal Revenue Code can also be claimed, even if it is not taxable due to a tax treaty. However, this income must still be reported on a US income tax return.
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Lowering tax withholding
Form W-4, also known as the Employee's Withholding Allowance Certificate, is an Internal Revenue Service (IRS) tax form that must be filled out when starting work in the US. The form helps determine how much should be withheld from each payslip through federal taxes and sent to the IRS. It is important to fill out the W-4 form correctly to ensure you pay the right amount of taxes and avoid overpayment.
To lower tax withholding, employees must claim dependents or use a deductions worksheet. The deductions worksheet can be found on page three of the W-4 form. Here, you can enter any extra tax you want to be withheld from each paycheck. Alternatively, you can elect to cite a simple dollar amount that you would like withheld for your pay in addition to your regular withholding.
If you have more than one job, you can complete the Multiple Jobs Worksheet on page three of the highest-paying job's W-4. If you and your spouse have a total of two jobs and earn roughly the same amount, you can check this box on both W-4s.
You can submit a new W-4 form at any time to adjust your withholdings. This allows you to review your next paycheck to see how much money was withheld and start estimating how much will be taken out of your paychecks for the full year.
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Frequently asked questions
Form W-4, or Employee’s Withholding Allowance Certificate, is an Internal Revenue Service (IRS) tax form that you must fill out when starting work in the US. It helps your employer understand your tax profile and how much should be withheld from each payslip through federal taxes.
You can obtain a W-4 form from your employer or download a copy from the IRS website.
The W-4 form requires basic personal information, including details of your tax filing status, other jobs you or your spouse might have, and any credits and deductions you expect to take.
The W-4 form will guide you in determining how much tax to withhold. You can also use the Deductions Worksheet on page three for further guidance.
No, it is not mandatory to update your W-4 form annually. However, your employer should remind you before December 1 each year to submit a new form if your withholding allowances have changed or will change for the next year.
